How Bradlees Died Off
Hey, everybody! This week’s blog is all about a little known franchise called Bradlees.
For those outside of New England, you may have never heard of Bradlees, but it was once a popular discount department store chain that operated primarily in the Northeastern United States. Bradlees sold various retail items in its stores, including clothing, jewelry, health care, beauty products, footwear, furniture, electronics, housewares, and bedding. It also had snack stands and lunch counters that served soft drinks, hot dogs, French fries, and other food items to shoppers.
Bradlees was named for Connecticut’s Bradley International Airport, where early planning meetings were held by the store’s founders. The first store was opened in New London, Connecticut, on March 14, 1958. The company was acquired by grocery chain Stop & Shop in 1961, which owned the chain until 1992. After the acquisition, Stop & Shop stores were often featured alongside Bradlees in the same shopping plazas. In some cases, especially in the New York/New Jersey metropolitan area, stores large enough to house both Bradlees and Stop & Shop under the same roof were constructed. In these early examples of supercenters, one side of the store would operate as Bradlees while the other would operate as Stop & Shop, and shoppers were able to move between one store and the other freely.
Bradlees was known for its TV and print ads featuring the character “Mrs. B.” (played by actress Cynthia Harris), depicted as the chain’s buyer, who constantly searched for bargains to pass on to her customers. The advertising jingle went, “At Bradlees, you buy what Mrs. B buys.”
Bradlees had some success in the 1990s, but it also faced increasing competition from other discount retailers such as Walmart, Target, and Kmart. Bradlees filed for bankruptcy in 1995, but managed to emerge from it in 1999. However, the chain could not sustain its recovery and filed for bankruptcy again in 2000. Bradlees did not survive its second bankruptcy filing and closed all of its stores by March 15, 2001. A company that once boasted over 15,000 employees and over 100 locations was no more.
Many people who shopped at Bradlees still remember the good times they had there. They miss the food, the deals, the variety of merchandise, and the locations. Bradlees may be gone, but it is not forgotten.
In this blog post, I will share with you some more details about the history of Bradlees, based on the information I found from various sources.
The Early Years
Bradlees got its start in the late 1950s. The company was conceived by three businessmen in Connecticut, who envisioned a store that offered a wide variety of goods at discount prices. Because the three met to discuss their idea for the new store at the Bradley International Airport, outside of Hartford, they chose to call their store “Bradlees.” The first Bradlees opened in New London, Connecticut, in 1958. Rather than having all of its merchandise owned by one vendor, it was comprised of a group of departments, each of which was run by a different licensee.
In 1961, just three years after its founding, the fledgling enterprise was acquired by Stop & Shop, a New England grocery store chain. With its purchase by Stop & Shop, Bradlees received a much-need infusion of capital. In the early 1960s, the company gradually moved from a licensee operation to direct ownership of its various departments, by letting its arrangements with its licensees expire. In the next years of the decade, Bradlees grew rapidly, as the discount department store industry came of age. By 1968, the company boasted 52 stores, which produced annual revenues of $139 million.
The Expansion Era
Throughout the 1970s, Bradlees continued to expand the number of stores it operated around the Northeast. The company also altered the nature and content of its merchandise, in an effort to position itself as a retailer of high-quality, low-cost goods. Bradlees increased the amount of clothing and accessories that it sold. In addition, in response to greater consumer interest in do-it-yourself home improvements, the company began to devote a larger quantity of display space to hardware and housewares. Throughout this time, Bradlees also spent money to upgrade its facilities. Renovations focused on increasing the amount of space devoted to sales in each of its outlets, and to modernizing fixtures, such as racks and shelves. In 1978 the company also announced that it would open six to ten discount stores devoted exclusively to women’s sportswear in junior and misses’ sizes. By the end of the 1970s, Bradlees’ overall sales had risen to $634 million.
The company entered the following decade poised for greater growth in a highly competitive discount retailing environment, dominated by giants such as Wal-Mart and Kmart. Bradlees continued to open new stores and remodel existing ones, while also introducing new services and features to attract customers. For example, in 1981, Bradlees launched its own credit card, which offered a 10 percent discount on the first purchase and a five percent discount on subsequent purchases. In 1983, the company introduced a new logo and slogan, “Bradlees. The Best for Less.” In 1984, Bradlees became one of the first retailers to offer a layaway plan, which allowed customers to reserve merchandise and pay for it in installments. In 1985, the company began to sell its own private-label merchandise, such as clothing, shoes, and accessories, under the brand name “Bradlees Best.”
The Turbulent Times
Despite its efforts to stay ahead of the competition, Bradlees faced some challenges in the late 1980s and early 1990s. The company suffered from a decline in consumer spending, due to a recession and a slowdown in the Northeastern economy. Bradlees also faced increased competition from other discounters, such as Wal-Mart, which entered the Northeastern market in 1988. In addition, Bradlees had to deal with some internal problems, such as inventory management, cost control, and employee relations. In 1989, the company reported its first annual loss since 1968, of $12.7 million. In 1990, the company closed 18 unprofitable stores and laid off 1,500 workers. In 1991, the company reported a loss of $67.6 million.
In 1992, Bradlees underwent a major change in its ownership and management. Stop & Shop, which had owned Bradlees for 31 years, decided to sell the chain to an investment group led by Citicorp Venture Capital Ltd. and Merrill Lynch Capital Partners Inc. The deal, valued at $450 million, was financed by a leveraged buyout, which involved borrowing money to buy the company and then paying off the debt with the company’s cash flow. The new owners appointed Barry Berman, a former executive of Ames Department Stores, as the president and chief executive officer of Bradlees. Berman’s mission was to turn around the struggling chain and make it profitable again.
Berman implemented a series of measures to improve Bradlees’ performance. He closed more unprofitable stores, reduced expenses, renegotiated leases, streamlined operations, and revamped merchandising. He also focused on enhancing customer service, increasing advertising, and expanding the company’s private-label offerings. Under Berman’s leadership, Bradlees showed signs of recovery. In 1993, the company reported a profit of $13.4 million, its first in four years. In 1994, the company went public, offering 10 million shares of common stock at $16 per share. The initial public offering raised $160 million, which was used to pay off some of the company’s debt.
The Final Chapter
Bradlees’ comeback, however, was short-lived. The company soon faced new challenges that threatened its survival. The Northeastern economy remained sluggish, and consumer spending remained low. The competition from other discounters intensified, as Wal-Mart, Target, and Kmart expanded their presence and market share in the region. Bradlees also faced legal troubles, as it was sued by several former employees and suppliers for various reasons, such as breach of contract, discrimination, and fraud. In addition, Bradlees was hit by a series of natural disasters, such as floods, blizzards, and hurricanes, that damaged some of its stores and disrupted its operations.
Bradlees filed for Chapter 11 bankruptcy protection on June 23, 1995, citing debts of $665 million and assets of $813 million. The company hoped to reorganize its finances and emerge from bankruptcy as a smaller but stronger chain. The company closed 54 stores, laid off 3,700 workers, and sold some of its assets, such as its distribution center and its headquarters building. The company also secured $250 million in financing from a group of lenders led by Chemical Bank. The company continued to operate its remaining 105 stores, while working on a plan to repay its creditors.
Bradlees managed to emerge from bankruptcy on February 4, 1999, after four years of restructuring. The company’s creditors agreed to forgive $275 million of its debt, in exchange for 100 percent ownership of the company. The company’s shareholders received nothing. Then, Bradlees also appointed a new president and chief executive officer, Peter Thorner, who replaced Berman, who had resigned in 1998.
Under Thorner’s leadership, Bradlees embarked on a new strategy to revive its fortunes. The company focused on improving its product offerings, customer service, and store layouts. It also launched aggressive marketing campaigns to reestablish its brand and attract new customers.
Despite these efforts, Bradlees continued to face significant challenges. The retail landscape had changed dramatically since the company’s heyday in the 1980s. Online shopping was becoming increasingly popular, and traditional brick-and-mortar retailers like Bradlees were struggling to adapt. Bradlees, with its heavy reliance on physical stores, found it difficult to compete in this new environment.
In 2001, Bradlees made the difficult decision to close all of its remaining stores and liquidate its assets. The company’s journey, from a beloved regional chain to bankruptcy and eventual closure, serves as a cautionary tale for other retailers. It underscores the importance of adaptability and innovation in a rapidly changing business environment.
Today, the former Bradlees stores stand as a reminder of a bygone era in American retail. Yet, the lessons learned from its rise and fall continue to resonate in the industry. As retailers navigate the challenges of the 21st century, they would do well to remember the story of Bradlees — a company that once soared high, only to be brought down by a combination of external challenges and internal missteps.
